Two perfectly competitive firms, Firm A and Firm B, both face random demand and have the same expected marginal revenue, as illustrated in the figure below. For which firm would a forecast of demand be more valuable?
A) Firm A
B) Firm B
C) The value for each firm is the same because the expected marginal revenue and marginal cost are the same.
D) A forecast is more valuable for Firm A if the demand will be high and more valuable for Firm B if the demand will be low.
A) Firm A
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An increase in the production of capital goods
A) must increase the current production of consumer goods. B) must decrease the future production of consumer goods. C) shifts the production possibilities frontier inward in the future. D) shifts the production possibilities frontier outward in the future.
Economists would largely motivate employees by appealing to their
A) compensation. B) need for time off. C) intrinsic motivation. D) none of these choices.
Suppose the dollar appreciates in the foreign exchange markets. What is the impact on U.S. Real GDP?
A) It must rise because dollar appreciation shifts the U.S. AD curve leftward. B) It must fall because dollar appreciation shifts the U.S. SRAS curve rightward. C) It must remain constant since dollar appreciation does not affect either the U.S. AD curve or the U.S. SRAS curve. D) It may rise, fall, or remain constant depending on whether the U.S. AD curve shifts leftward by more, less, or an amount equal to the rightward shift of the U.S. SRAS curve.
(Consider This) Governments' main economic concern about low birthrates is that:
A. in a few decades there will not be enough working-age adults to support pension responsibilities to retirees. B. the smaller population makes the economy more vulnerable to foreign takeover. C. a declining population will reduce worker productivity. D. smaller populations are more susceptible to epidemics.